EMPLOYMENT AGREEMENT
Exhibit 10.3
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of February 5, 2008
(the “Effective Date”), by and among SUN COMMUNITIES, INC., a Maryland corporation (the
“REIT”), SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP, a Michigan limited partnership
(“SCOLP”) and XXXXX X. XXXXXXX (the “Executive”). As used herein,
“Company” shall refer to the REIT and SCOLP together.
W I T N E S S E T H:
WHEREAS, SCOLP operates the business of the REIT;
WHEREAS, the REIT is the sole general partner of SCOLP;
WHEREAS, Executive has historically provided services not only to the REIT, but also to SCOLP;
and
WHEREAS, the Company desires to continue the employment of the Executive, and the Executive
desires to continue to be employed by the Company, on the terms and subject to the conditions set
forth below.
NOW, THEREFORE, in consideration of the mutual promises contained in this Agreement and other
good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the
parties agree as follows:
1. Employment.
(a) The Company agrees to employ the Executive and the Executive accepts the
employment, on the terms and subject to the conditions set forth below. During the Term
(defined below), the Executive shall serve as Executive Vice President, Chief Financial
Officer, Secretary and Treasurer of the REIT, shall manage the Company’s Accounting and Tax
Departments and shall do and perform diligently all such services, acts and things as are
customarily done and performed by such officers of companies in similar business and in size
to the REIT, together with such other duties as may reasonably be requested from time to
time by the REIT’s Chief Executive Officer or the Board of Directors of the REIT (the
“Board”), which duties may include oversight of the Company’s Human Resources and
Information Technology Departments, and shall be consistent with the Executive’s positions
as set forth above.
(b) For service as an officer and employee of the Company, the Executive shall be
entitled to the full protection of the applicable indemnification provisions of the Articles
of Incorporation and Bylaws of the REIT, as they may be amended from time to time.
2. Term of Employment.
(a) Subject to the provisions for termination provided below, the term of the
Executive’s employment under this Agreement shall commence on the Effective Date and shall
continue thereafter until December 31, 2010 (the “Initial Term”); provided, however,
that following the expiration of the Initial Term, the term of this Agreement shall be
automatically extended for successive terms of one (1) year each thereafter (each a
“Renewal Term”), unless either party notifies the other party in writing of its
desire to
terminate this Agreement at least ninety (90) days before the end of the Initial Term or the
Renewal Term then in effect. The Initial Term and each Renewal Term are collectively
referred to as the “Term.”
(b) Executive acknowledges and agrees that Executive is an “at-will” employee and that
Executive’s employment may be terminated, with or without cause, at the option of Executive
or the REIT.
3. Devotion to the Company’s Business. The Executive shall devote her best efforts,
knowledge, skill, and her entire productive time, ability and attention to the business of the
Company during the term of this Agreement.
4. Compensation.
(a) During the Term, the Company shall pay or provide, as the case may be, to the
Executive the compensation and other benefits and rights set forth in paragraphs 4, 5 and 6
of this Agreement.
(b) Base Compensation. As compensation for the services to be performed
hereunder, the Company shall pay to the Executive, during her employment hereunder, an
annual base salary (the “Base Salary”) payable in accordance with the Company’s
usual pay practices (including tax withholding), but in no event less frequently than
monthly, at the rate of:
(i) Two Hundred Forty Five Thousand Dollars ($245,000.00) for the period
beginning on the Effective Date and ending on December 31, 2008;
(ii) Two Hundred Sixty Five Thousand Dollars ($265,000.00) for the period
beginning on January 1, 2009 and ending on December 31, 2009; and
(iii) Two Hundred Ninety Thousand Dollars ($290,000.00) thereafter, but subject
to adjustment pursuant to Section 4(c) below.
(c) COLA Adjustment. At the beginning of each Renewal Term, if any (each an
“Adjustment Date”), Executive’s Base Salary shall be increased in accordance with
the increase, if any, in the cost of living during the preceding one year as determined by
the percentage increase in the Consumers Price Index-All Urban Consumers (U.S. City
Average/all items) published by the Bureau of Labor Statistics of the U.S. Department of
Labor (the “Index”). The average Index for calendar year immediately preceding the
Adjustment Date shall be considered the “Base.” The Base Salary for the calendar
year following each Adjustment Date shall be the Base Salary specified in Paragraph
4(b)(iii) increased by the percentage increase, if any, in the Index for the calendar year
immediately preceding the Adjustment Date over the Base. In the event the Index shall cease
to be published or the formula underlying the Index shall change materially from the formula
used for the Index as of the date hereof, then there shall be substituted for the Index such
other index of similar nature as is then generally recognized and accepted. In no event
shall the Base Salary during each adjusted calendar year be less than that paid during the
preceding year of this Agreement.
(d) Bonus. Executive will be eligible to receive a discretionary bonus for each
calendar year during the Term (the “Bonus”). The amount of any Bonus shall be
determined by the Compensation Committee of the Board and shall be an amount of up to 100%
of the Base Salary for each calendar year that the Executive is employed under this
Agreement (“Bonus Year”), which Bonus shall be determined and calculated with respect
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to each Bonus Year as follows: (i) if and to the extent, in the sole discretion of the
Compensation Committee and based on criteria generated by the Compensation Committee of the
Board by March 15 of each year, the Company meets certain criteria and Executive fulfills
her individual goals and objectives for such Bonus Year, the Executive shall receive a Bonus
in the amount of up to 50% of the then current Base Salary; and (ii) up to an additional 50%
the then current Base Salary may be awarded to the Executive in the sole discretion of the
Compensation Committee based on criteria determined by the Compensation Committee at the
time of the determination of the Bonus, which may be based on any number of individual,
company and/or industry factors. The determination of the Bonus shall be made by the
Compensation Committee of the Board no later than March 7 of the following calendar year.
(e) Disability. During any period that the Executive fails to perform her
duties hereunder as a result of incapacity due to physical or mental illness (the
“Disability Period”), the Executive shall continue to receive her full Base Salary,
Bonus and other benefits at the rate in effect for such period until her employment is
terminated by the Company pursuant to paragraph 7(a)(iii) below; provided, however, that
payments so made to the Executive during the Disability Period shall be reduced by the sum
of the amounts, if any, which were paid to the Executive at or prior to the time of any such
payment under disability benefit plans of the Company.
(f) Restricted Stock. On the Effective Date, the REIT shall grant and issue to
Executive (the “Restricted Stock Award”) 10,000 shares of the REIT’s common stock
(the “Shares”). The grant of the Restricted Stock Award shall be subject to the
terms and conditions contained in the REIT’s standard Restricted Stock Award Agreement (the
“Restricted Stock Award Agreement”) and all applicable terms and conditions of the
REIT’s Amended and Restated 1993 Stock Option Plan. In addition to the foregoing, the
Restricted Stock Award shall vest as follows: (i) thirty-five percent (35%) of the Shares
(rounded down to the nearest whole number) shall vest on the fourth anniversary of the
Effective Date; (ii) thirty-five percent (35%) of the Shares (rounded down to the nearest
whole number) shall vest on the fifth anniversary of the Effective Date; (iii) twenty
percent (20%) of the Shares (rounded down to the nearest whole number) shall vest on the
sixth anniversary of the Effective Date; (iv) five percent (5%) of the Shares (rounded down
to the nearest whole number) shall vest on the seventh anniversary of the Effective Date;
and (v) the remainder of the Shares shall vest on the tenth anniversary of the Effective
Date. The grant of the Restricted Stock Award is expressly conditioned upon the Executive’s
execution of the Restricted Stock Award Agreement.
5. Benefits.
(a) Insurance. The Company shall provide to the Executive life, medical and
hospitalization insurance for herself, her spouse and eligible family members as may be
determined by the Board to be consistent with the Company’s standard policies.
(b) Benefit Plans. The Executive, at her election, may participate, during her
employment hereunder, in all retirement plans, 401(K) plans and other benefit plans of the
Company generally available from time to time to other executive employees of the Company
and for which the Executive qualifies under the terms of the plans (and nothing in this
Agreement shall or shall be deemed to in any way affect the Executive’s right and benefits
under any such plan except as expressly provided herein). At the discretion of the
Compensation Committee of the Board, the Executive may also be entitled to participate in
any equity, stock option or other employee benefit plan that is generally available to
senior executives of the Company. In addition to the foregoing, the Executive’s
participation in and benefits under any such plan shall be on the terms and
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subject to the conditions specified in the governing document of the particular plan.
Nothing contained in this Agreement shall be construed to create any obligation on the part
of the Company to establish any such plan or to maintain the effectiveness of any such plan
which may be in effect from time to time.
(c) Annual Vacation. The Executive shall be entitled to four (4) weeks
vacation time each year, without loss of compensation. The Executive shall not take more
than fourteen (14) consecutive calendar days of vacation without the prior approval of the
REIT’s Chief Executive Officer. Unless otherwise approved by the Chief Executive Officer of
the REIT, in the event that the Executive does not take the total amount of vacation time
authorized under this Agreement during any calendar year, such vacation time shall not
accrue and the Executive shall forfeit any such unused vacation time. Upon any termination
of this Agreement for any reason whatsoever, accrued and unused vacation time (not to exceed
twenty (20) business days) shall be paid to the Executive within ten (10) days of such
termination based on the Base Salary in effect on the date of such termination. For purpose
of this Agreement, one-twelfth (1/12) of the applicable annual vacation time shall accrue on
the last day of each calendar month that the Executive is employed under this Agreement.
6. Reimbursement of Business Expenses. The Company shall reimburse the Executive for
travel, entertainment and other expenses reasonably and necessarily incurred by the Executive in
the performance of her duties under this Agreement. The Executive shall furnish such documentation
with respect to reimbursement to be paid hereunder as the Company shall reasonably request.
7. Termination of Employment.
(a) The Executive’s employment under this Agreement may be terminated: |
(i) by either the Executive or the REIT at any time for any reason whatsoever
or for no reason upon not less than sixty (60) days written notice;
(ii) by the REIT at any time for “cause” as defined below, without prior
notice;
(iii) by the REIT upon the Executive’s “permanent disability” (as defined
below) upon not less than thirty (30) days written notice; and
(iv) upon the Executive’s death.
(b) For purposes hereof, for “cause” shall mean: (i) a material breach of any
provision of this Agreement by Executive (if the breach is curable, it will constitute cause
only if it continues uncured for a period of twenty (20) days after Executive’s receipt of
written notice of such breach from the Company); (ii) Executive’s failure or refusal, in any
material manner, to perform all lawful services required of her pursuant to this Agreement,
which failure or refusal continues for more than twenty (20) days after Executive’s receipt
of written notice of such deficiency; (iii) Executive’s commission of fraud, embezzlement or
theft, or a crime constituting moral turpitude, in any case, whether or not involving
Company, that in the reasonable good faith judgment of the REIT, renders Executive’s
continued employment harmful to the Company; (iv) Executive’s misappropriation of Company
assets or property, including, without limitation, obtaining reimbursement through
fraudulent vouchers or expense reports; or (v) Executive’s conviction or the entry of a plea
of guilty or no contest by Executive with respect to any felony or other crime that, in the
reasonable good faith judgment of the
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REIT, adversely affects the Company or its reputation or business.
(c) For purposes hereof, the Executive’s “permanent disability” shall be deemed
to have occurred if Executive has become unable to perform the essential functions and
responsibilities of her position with reasonable accommodation, as required under the
Americans with Disabilities Act, as the same has and may be amended (the “ADA”), by
virtue of a disability (as defined under the ADA).
8. Compensation Upon Termination or Disability.
(a) In the event that the REIT terminates the Executive’s employment under this
Agreement without “cause” pursuant to paragraph 7(a)(i), (i) the Executive shall be entitled
to any accrued and unpaid Base Salary, Bonus and benefits through the effective date of such
termination, prorated for the number of days actually employed in the then current calendar
year, which shall be paid by the Company to the Executive within thirty (30) days of the
effective date of such termination (or such later date as may be required in order to
determine the amount of any Bonus due to the Executive), and (ii) subject to the Executive’s
execution of a general release of claims in a form satisfactory to the Company, the Company
shall pay the Executive monthly an amount equal to one-twelfth (1/12) of the Base Salary (at
the rate that would otherwise have been payable under this Agreement) for a period of up to
twelve (12) months if the Executive fully complies with paragraph 12 of this Agreement (the
“Severance Payment”). Notwithstanding the foregoing, the Company, in its sole
discretion, may elect to make the Severance Payment to the Executive in one lump sum due
within thirty (30) days of the Executive’s termination of employment and the Severance
Payment shall not be due Executive if Executive is entitled to Change in Control Benefits
(as defined in paragraph 10 below).
(b) In the event of termination of the Executive’s employment under this Agreement for
“cause” or if the Executive voluntarily terminates her employment hereunder, the Executive
shall be entitled to no further compensation or other benefits under this Agreement, except
only as to any accrued and unpaid Base Salary and benefits through the effective date of
such termination, prorated for the number of days actually employed in the then current
calendar year.
(c) In the event of termination of the Executive’s employment under this Agreement due
to the Executive’s permanent disability or death, (i) the Executive (or her successors and
assigns in the event of her death) shall be entitled to any accrued and unpaid Base Salary,
Bonus and benefits through the effective date of such termination, prorated for the number
of days actually employed in the then current calendar year, which shall be paid by the
Company to the Executive or her successors and assigns, as appropriate, within thirty (30)
days of the effective date of such termination, and (ii) the Company shall pay the Executive
monthly an amount equal to one-twelfth (1/12) of the Base Salary (at the rate that would
otherwise have been payable under this Agreement) for a period of up to twenty-four (24)
months if the Executive fully complies with paragraph 12 of this Agreement (the
“Disability Payment”); provided, however, that payments so made to the Executive
shall be reduced by the sum of the amounts, if any, which: (i) were paid to the Executive at
or prior to the time of any such payment under disability benefit plans of the Company, and
(ii) did not previously reduce the Base Salary, Bonus and other benefits due the Executive
under paragraph 4(e) of this Agreement. Notwithstanding the foregoing, the Company, in its
sole discretion, may elect to make the Disability Payment to the Executive in one lump sum
due within thirty (30) days of the Executive’s termination of employment. The Executive
agrees to cooperate in any reasonable requirement to undertake a medical physical
examination as may be reasonably requested by an insurance carrier in the event that the
Company
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decides to incur additional death or disability insurance coverage on the Executive in order
to cover any amount of the Disability Payment that may become due.
(d) Notwithstanding anything to the contrary in this paragraph 8, the Company’s
obligation to pay, and the Executive’s right to receive, any compensation under this
paragraph 8, including, without limitation, the Severance Payment and the Disability
Payment, shall terminate upon the Executive’s breach of any provision of paragraph 12
hereof. In addition, the Executive shall promptly forfeit any compensation received from
the Company under this paragraph 8, including, without limitation, the Severance Payment and
the Disability Payment, upon the Executive’s breach of any provision of paragraph 12 hereof.
9. Resignation of Executive. Upon any termination of the Executive’s employment under
this Agreement, the Executive shall be deemed to have resigned from any and all offices and
directorships held by the Executive in the Company and/or any of the Affiliates (as defined below).
10. Effect of Change in Control.
(a) The Company or its successor shall pay the Executive the Change in Control Benefits (as
defined below) if there has been a Change in Control (as defined below) and any of the
following events has occurred (each a “Triggering Event”): (i) the Executive’s
employment under this Agreement is terminated by the Company or its successor in accordance
with paragraph 7(a)(i) at any time within twenty-four (24) months after the Change in
Control, (ii) upon a Change in Control under paragraph 10(f)(ii), the Company or its
successor does not expressly assume all of the terms and conditions of this Agreement, or
(iii) there are less than eighteen (18) months remaining under the Initial Term of this
Agreement (without regard to the last clause of Paragraph 2 hereof).
(b) For purposes of this Agreement, the “Change in Control Benefits” shall mean
the following benefits:
(i) A cash payment equal to (I) two and 99/100 (2.99) times the Base Salary in
effect on the date of such Change in Control, less (II) any amounts paid to
Executive under this Agreement following a Change in Control, but prior to the
occurrence of a Triggering Event, payable within sixty (60) days of the Change in
Control or, in the event that the cessation of Executive’s employment hereunder
triggers the Change in Control Benefits, payable within thirty (30) days after such
cessation of employment; and
(ii) Continued receipt of all compensation and benefits set forth in paragraphs
5(a) and 5(b) of this Agreement, until the earlier of (I) one year following the
Change in Control (subject to the Executive’s COBRA rights) or (II) the commencement
of comparable coverage from another employer. The provision of any one benefit by
another employer shall not preclude the Executive from continuing participation in
Company benefit programs provided under this paragraph 10(b)(ii) that are not
provided by the subsequent employer. The Executive shall promptly notify the
Company upon receipt of benefits from a new employer comparable to any benefit
provided under this paragraph 10(b)(ii).
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(c) Notwithstanding anything to the contrary herein, (i) in the event that the
Executive’s employment under this Agreement is terminated by the Company or its successor in
accordance with paragraph 7(a)(i) within sixty (60) days prior to a Change in Control, such
termination shall be deemed to have been made in connection with the Change in Control and
the Executive shall be entitled to the Change in Control Benefits.
(d) The Change in Control Benefits shall be in addition to the acceleration of the
vesting of, and the extension of the time for exercise of, stock options as a result of the
Change in Control.
(e) Notwithstanding anything to the contrary contained herein, in the event it shall be
determined that any compensation payment or distribution by the Company to or for the
benefit of the Executive would be subject to the excise tax imposed by Section 4999 of the
Internal Revenue Code of 1986, as amended (the “Code”), the Change in Control
Benefits will be reduced to the extent necessary so that no excise tax will be imposed, but
only if to do so would result in the Executive retaining a larger amount, on an after-tax
basis, taking into account the excise and income taxes imposed on all payments made to the
Executive hereunder.
(f) The Company shall pay to the Executive all reasonable legal fees and expenses
incurred by the Executive in obtaining or enforcing any right or benefit provided by this
paragraph 10, but only to the extent that the Company is adjudged liable to the Executive
for breach of this paragraph 10 as a part of a final judgment on the merits by a court of
proper jurisdiction or pursuant to binding arbitration agreed to by the parties.
(g) For purposes of this Agreement, a “Change in Control” shall be deemed to
have occurred upon the closing of any of the following transactions:
(i) if any person or group of persons acting together (other than (a) the
Company or any person (I) who as of the date hereof was a director or officer of the
REIT, or (II) whose shares of Common Stock of the REIT are treated as “beneficially
owned” by any such director or officer, or (b) any institutional investor (filing
reports under Section 13(g) rather than 13(d) of the Securities Exchange Act of
1934, as amended, including any employee benefit plan or employee benefit trust
sponsored by the Company)), becomes a beneficial owner, directly or indirectly, of
securities of the REIT representing fifty percent (50%) or more of either the
then-outstanding Common Stock of the REIT or the combined voting power of the REIT
then-outstanding voting securities (other than as a result of an acquisition of
securities directly from the REIT);
(ii) if the Company sells all or substantially all of the Company’s assets to
any person (other than a wholly-owned subsidiary of the Company formed for the
purpose of changing the Company’s corporate domicile);
(iii) if the Company merges or consolidates with another person as a result of
which the shareholders of the REIT immediately prior to such merger or consolidation
would beneficially own (directly or indirectly), immediately after such merger or
consolidation, securities of the surviving entity representing less than fifty
percent (50%) of the then outstanding voting securities of the surviving entity; or
(iv) if the new directors appointed to the Board during any twelve-month period
constitute a majority of the members of the Board, unless (I)
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the directors who were
in office for at least twelve (12) months prior to such
twelve-month period (the “Incumbent Directors”) plus (II) the new directors
who were recommended or appointed by a majority of the Incumbent Directors
constitutes a majority of the members of the Board.
For purposes of this paragraph 10(g), a “person” includes an individual, a
partnership, a corporation, an association, an unincorporated organization, a trust or any
other entity.
11. Stock Awards. In the event of termination of the Executive’s employment under
this Agreement for “cause”, all stock options or other stock based compensation awarded to the
Executive shall lapse and be of no further force or effect whatsoever in accordance with the
Company’s equity incentive plans. If the Company terminates the Executive’s employment under this
Agreement without “cause” or upon the death or permanent disability of the Executive, all stock
options and other stock based compensation awarded to the Executive shall become fully vested and
immediately exercisable, subject to the restrictions of Section 9.02 of the Company’s Amended and
Restated 1993 Stock Option Plan. Upon a Change in Control, all stock options or other stock based
compensation awarded to the Executive shall become fully vested and immediately exercisable and may
be exercised by the Executive at any time within one (1) year after the Change in Control. All
Stock Option Agreements between the Company and the Executive shall be amended to conform to the
provisions of this paragraph 11. In the event of an inconsistency between this paragraph 11 and
such Stock Option Agreements, this paragraph 11 shall control.
12. Covenant Not To Compete and Confidentiality.
(a) The Executive acknowledges the Company’s reliance on and expectation of the
Executive’s continued commitment to performance of her duties and responsibilities during
the term of this Agreement. In light of such reliance and expectation on the part of the
Company, the Executive agrees that:
(i) for a period commencing on the date of this Agreement and ending upon the
expiration of twenty-four (24) months following the termination of the Executive’s
employment under this Agreement for any reason, including, without limitation, the
expiration of the term of this Agreement (the “Non-competition Period”), the
Executive shall not, either directly or indirectly, engage in, or have an interest
in or be associated with (whether as an officer, director, stockholder, partner,
associate, employee, consultant, owner or otherwise) any corporation, firm or
enterprise which is engaged in the development, ownership, leasing, management,
financing or sales of manufactured housing communities and/or manufactured homes,
anywhere within the continental United States or Canada; provided,
however, that, notwithstanding anything to the contrary herein, (1) in the
event that the Executive voluntarily terminates her employment with the Company, the
Non-competition Period shall extend until the later of the remainder of the initial
3-year term of this Agreement or the expiration of twenty-four (24) months following
the termination of Executive’s employment under this Agreement, (2) in the event
that the Company terminates the Executive’s employment hereunder without “cause”,
the Non-competition Period shall be reduced to twelve (12) months, and (3) the
Executive may invest in any publicly held corporation engaged, if such investment
does not exceed one percent (1%) in value of the issued and outstanding capital
stock of such corporation;
(ii) the Executive will not at any time, for so long as any Confidential
Information (as defined below) shall remain confidential or otherwise remain wholly
or partially protectable, either during the term of this Agreement or
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thereafter,
use or disclose, directly or indirectly, to any person outside of the
Company, or any corporation owned or controlled by the Company or under common
control with the Company (the “Affiliates”), any Confidential Information;
(iii) promptly upon the termination of this Agreement for any reason, the
Executive (or in the event of the Executive’s death, her personal representative)
shall return to the Company any and all copies (whether prepared by or at the
direction of the Company or Executive) of all records, drawings, materials,
memoranda and other data constituting or pertaining to Confidential Information;
(iv) for a period commencing on the date of this Agreement and ending upon the
expiration of the Non-competition Period, the Executive shall not, either directly
or indirectly, divert, or by aid to others, do anything which would tend to divert,
from the Company or any Affiliate any trade or business with any customer or
supplier with whom the Executive had any contact or association during the term of
the Executive’s employment with the Company or with any party whose identity or
potential as a customer or supplier was confidential or learned by the Executive
during her employment by the Company; and
(v) for a period commencing on the date of this Agreement and ending upon the
expiration of the Non-competition Period, the Executive shall not, either directly
or indirectly, call upon, compete for or solicit for employment any person with whom
the Executive was acquainted while employed by the Company.
As used in this Agreement, the term “Confidential Information” shall mean all business
information of any nature and in any form which at the time or times concerned is not generally
known to those persons engaged in business similar to that conducted or contemplated by the Company
or any Affiliate (other than by the act or acts of an employee not authorized by the Company to
disclose such information) and which relates to any one or more of the aspects of the present or
past business of the Company or any of the Affiliates or any of their respective predecessors,
including, without limitation, financial information, business plans, prospects, opportunities
which have been discussed or considered by the management of the Company, and other trade secrets.
(b) The Executive agrees and understands that the remedy at law for any breach by her
of this paragraph 12 will be inadequate and that the damages flowing from such breach are
not readily susceptible to being measured in monetary terms. Accordingly, it is
acknowledged that, upon adequate proof of the Executive’s violation of any legally
enforceable provision of this paragraph 12, the Company shall be entitled to immediate
injunctive relief and may obtain a temporary order restraining any threatened or further
breach. Nothing in this paragraph 12 shall be deemed to limit the Company’s remedies at law
or in equity for any breach by the Executive of any of the provisions of this paragraph 12
which may be pursued or availed of by the Company. This paragraph 12 shall survive the
termination of this Agreement.
(c) Executive acknowledges and agrees that the covenants set forth above are reasonable
and valid in geographical and temporal scope and in all other respects. If any court
determines that any of the covenants, or any part of any covenant, is invalid or
unenforceable, the remainder of the covenants shall not be affected and shall be given full
effect, without regard to the invalid portion. If any court determines that any of the
covenants, or any part of any covenant, is unenforceable because of its duration or
geographic scope, such court shall have the power to reduce the duration or scope, as the
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case may be, and, enforce such provision in such reduced form. Executive and the
Company intend to and hereby confer jurisdiction to enforce the covenants upon the courts of
any jurisdiction within the geographical scope of such covenants. If the courts of any one
or more of such jurisdictions hold the covenants, or any part of any covenant, unenforceable
by reason of the breadth of such scope or otherwise, it is the intention of Executive and
the Company that such determination not bar or in any way affect the right of the Company to
the relief provided above in the courts of any other jurisdiction within the geographical
scope of such covenants as to breaches of such covenants in such other respective
jurisdictions. For this purpose, such covenants as they relate to each jurisdiction shall
be severable into diverse and independent covenants.
13. Arbitration. The parties agree that any and all disputes, controversies or claims
of any nature whatsoever relating to, or arising out of, this Agreement or Executive’s employment,
whether in contract, tort, or otherwise (including, without limitation, claims of wrongful
termination of employment, claims under Title VII of the Civil Rights Act, the Fair Labor Standards
Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, or comparable
state or federal laws, and any other laws dealing with employees’ rights and remedies), shall be
settled by mandatory arbitration administered by the American Arbitration Association under its
National Rules for the Resolution of Employment Disputes (the “Rules”) and the following
provisions: (a) a single arbitrator (the “Arbitrator”), mutually agreeable to the Company
and Executive, shall preside over the arbitration and shall make all decisions with respect to the
resolution of the dispute, controversy or claim between the parties; (b) in the event that the
Company and Executive are unable to agree on an Arbitrator within fifteen (15) days after either
party has filed for arbitration in accordance with the Rules, they shall select a truly neutral
arbitrator in accordance with the rules for the selection of neutral arbitrators, who shall be the
“Arbitrator” for the purposes of this paragraph 13; (c) the place of arbitration shall be
Southfield, Michigan unless mutually agreed otherwise; (d) judgment may be entered on any award
rendered by the Arbitrator in any federal or state court having jurisdiction over the parties; (e)
all fees and expenses of the Arbitrator shall be shared equally between Company and Executive; (f)
the decision of the Arbitrator shall govern and shall be conclusive and binding upon the parties;
(g) the parties shall be entitled to reasonable levels of discovery in accordance with the Federal
Rules of Civil Procedure or as permitted by the Arbitrator, provided, however, that the time
permitted for discovery shall not exceed eight (8) weeks and each party shall be limited to two (2)
depositions; and (h) this provision shall be enforceable by specific performance and/or injunctive
relief, and shall constitute a basis for dismissal of any legal action brought in violation of the
duty to arbitrate. The parties hereby acknowledge that it is their intent to expedite the
resolution of any dispute, controversy or claim hereunder and that the Arbitrator shall schedule
the timing of discovery and of the hearing consistent with that intent. Notwithstanding anything
to the contrary herein, nothing contained in this paragraph shall be construed to preclude Company
from obtaining injunctive or other equitable relief to secure specific performance or to otherwise
prevent Executive’s breach of paragraph 12 of this Agreement.
14. Notice. Any notice, request, consent or other communication given or made
hereunder shall be given or made only in writing and (a) delivered personally to the party to whom
it is directed; (b) sent by first class mail or overnight express mail, postage and charges
prepaid, addressed to the party to whom it is directed; or (c) telecopied to the party to whom it
is directed, at the following addresses or at such other addresses as the parties may hereafter
indicate by written notice as provided herein:
If to the REIT or SCOLP:
Sun Communities. Inc.
00000 Xxxxxxxx Xxxx, Xxxxx 000
00000 Xxxxxxxx Xxxx, Xxxxx 000
00
Xxxxxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attn: Chief Executive Officer
Fax: (000) 000-0000
Attn: Chief Executive Officer
If to the Executive:
Xxxxx X. Xxxxxxx
00000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
00000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
In all events, with a copy to:
Jaffe, Raitt, Heuer & Xxxxx,
Professional Corporation
00000 Xxxxxxxx Xxxx
Xxxxx 0000
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx
Professional Corporation
00000 Xxxxxxxx Xxxx
Xxxxx 0000
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx
Any such notice, request, consent or other communication given or made: (i) in the manner
indicated in clause (a) of this paragraph shall be deemed to be given or made on the date on which
it was delivered; (ii) in the manner indicated in clause (b) of this paragraph shall be deemed to
be given or made on the third business day after the day in which it was deposited in a regularly
maintained receptacle for the deposit of the United States mail, or in the case of overnight
express mail, on the business day immediately following the day on which it was deposited in the
regularly maintained receptacle for the deposit of overnight express mail; and (iii) in the manner
indicated in clause (c) of this paragraph shall be deemed to be given or made when received by the
telecopier owned or operated by the recipient thereof.
15. Cooperation in Future Matters. Executive hereby agrees that, for a period of
eighteen (18) months following her termination of employment for any reason whatsoever, she shall
cooperate with the Company’s reasonable requests relating to matters that pertain to Executive’s
employment by the Company, including, without limitation, providing information or limited
consultation as to such matters, participating in legal proceedings, investigations or audits on
behalf of the Company, or otherwise making herself reasonably available to the Company for other
related purposes. Any such cooperation shall be performed at scheduled times taking into
consideration Executive’s other commitments, and Executive shall be compensated at a reasonable
hourly or per diem rate to be agreed upon by the parties to the extent such cooperation is required
on more than an occasional and limited basis. Executive shall not be required to perform such
cooperation to the extent it conflicts with any requirements of exclusivity of services for another
employer or otherwise, nor in any manner that in the good faith belief of Executive would conflict
with her rights under or ability to enforce this Agreement.
16. Miscellaneous.
(a) The provisions of this Agreement are severable and if any one or more provisions
may be determined to be illegal or otherwise unenforceable, in whole or in part, the
remaining provisions and any partially unenforceable provision to the extent enforceable in
any jurisdiction nevertheless shall be binding and enforceable.
(b) Neither the Company nor the Executive may make any assignment of this
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Agreement or
any interest herein, by operation of law or otherwise, without the prior written consent of
the other party; provided that the Company may assign its rights under this Agreement
without the consent of the Executive in the event that the Company shall effect a
reorganization, consolidate with or merge into another corporation, partnership,
organization or other entity, or transfer all or substantially all of its properties or
assets to any other corporation, partnership, organization or other entity. This Agreement
shall inure to the benefit of and be binding upon the Company and the Executive, their
respective successors, executors, administrators, heirs and permitted assigns.
(c) The failure of either party to enforce any provision or protections of this
Agreement shall not in any way be construed as a waiver of any such provision or provisions
as to any future violations thereof, nor prevent that party thereafter from enforcing each
and every other provision of this Agreement. The rights granted the parties herein are
cumulative and the waiver of any single remedy shall not constitute a waiver of such party’s
right to assert all other legal remedies available to it under the circumstances.
(d) The Board shall allocate all compensation described in Sections 4, 6, 8 and 10
between the REIT and SCOLP on an annual basis, after determining the services provided to
each entity by the Executive for the relevant period. For tax reporting purposes, all
compensation will be appropriately reported to the Executive and Federal and state taxing
authorities based upon the Executive’s legal relationship with each entity as determined
under applicable law.
(e) This Agreement supersedes all agreements, understandings, representations,
warranties, negotiations and discussions between the parties with respect to the subject
matter hereof. No modification, termination or waiver shall be valid unless in writing and
signed by the party against whom the same is sought to be enforced.
(f) This Agreement shall be governed by and construed according to the laws of the
State of Michigan.
(g) Captions and paragraph headings used herein are for convenience and are not a part
of this Agreement and shall not be used in construing it.
(h) This Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same instrument.
(i) Except as otherwise provided in paragraph 10(f) above, each party shall pay her or
its own fees and expenses, including, without limitation, legal fees, incurred in connection
with the transactions contemplated by this Agreement, including, without limitation, any
fees incurred in connection with any arbitration arising out of the transactions
contemplated by this Agreement.
[Signatures on following page]
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement on the date first
written above.
| REIT: SUN COMMUNITIES, INC., a Maryland corporation |
||||
| By: | /s/ Xxxx X. Xxxxxxxx | |||
| Xxxx X. Xxxxxxxx, President and | ||||
| Chief Executive Officer | ||||
SCOLP:
SUN COMMUNITIES OPERATING LIMITED
PARTNERSHIP, a Michigan limited partnership
PARTNERSHIP, a Michigan limited partnership
By: SUN COMMUNITIES, INC.,
a Maryland corporation, its General Partner
a Maryland corporation, its General Partner
| By: | /s/ Xxxx X. Xxxxxxxx | |||
| Xxxx X. Xxxxxxxx, President and | ||||
| Chief Executive Officer | ||||
| EXECUTIVE: |
||||
| /s/ Xxxxx X. Xxxxxxx | ||||
| XXXXX X. XXXXXXX | ||||
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